FEMA flood help is not insurance, but assistance

9/19/13 - 5 p.m. - There's confusion among flood victims about how the FEMA process works. FEMA says it is not backup insurance.

KMGH

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DENVER - FEMA, the Federal Emergency Management Agency, says it has already distributed $4 million in assistance to individuals in the seven Colorado counties designated as federal disaster areas.

But there is frustration and misconceptions about how the assistance works.

Like most people who live near the Big Thompson River, Mark Lundquist lost a lot.

"At least a third to almost half of my property is destroyed. It's gone. It's now a river bed," he said.

Lundquist did not have flood insurance, so when FEMA came in this week, he was hoping for some good news.

"I expect them to come in and assess all of my goods," he said. "All the things I've lost -- tools, air tools, all kinds of storage things in the back. I mean, just valuables."

A FEMA spokesman told 7NEWS that’s a common misconception. The spokesman said FEMA is not backup insurance. Instead, he said they provide assistance to individuals for four primary things:

1) Temporary housing - up to 18 months of rental payments while you rebuild or relocate.

2) Reimbursement for minor home repairs to make your home habitable.

3) Low-interest small business loans to help rebuild your home.

4) Other needs assistance, like grants for things like medical supplies, basic home furnishings and storage if you're flooded out.

FEMA said its primary function for this flood is to get people whose homes were destroyed into safe, livable housing. Based on need, homeowners could get up to a maximum of $31,000 that they don't have to repay.

FEMA said it's designed to get you get on your feet by empowering you to go solve your problem.

Lundquist estimates his losses at $100,000.

"It's just beyond the scope of reality," Lunquist said. "I'm going to try to get flood insurance now."